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This article explains how to invest in Nigerian Treasury Bills

  • A beginner guide to investing in treasury bills.
  • Water-down explanation of treasury bills and how to invest in it.
  • Quick tips on how interest is earned and when it is paid to an investor.
  • A run-down on benefits of investing in treasury bills

What are Treasury Bills?

Treasury Bills are government guaranteed debt instruments issued by CBN on their behalf to finance expenditure. The CBN also uses treasury bills to control money supply in the economy.

How are Treasury Bills Sold?

Treasury Bills are sold through a bi-weekly auction conducted by the CBN. Buyers are requested to quote bids following which the average minimum bid is selected.

Where can I buy Treasury Bills?

Treasury Bills can be bought through any official dealer. The easiest this days are through banks’ treasury bill mobile application. A typical example is the Sterling Bank’s i-invest.

What is the Minimum Amount I can Buy?

Before, you could buy for as low as N10,000 and in multiples of N1,000 thereafter. However, this was increased to N50,000,001 in 2017. This article explains how you can buy treasury bills if you do not have up to N50 million. Though, the minimum for the i-invest mobile application is N100,000.

When is it usually sold?

Treasury Bills is sold every other Wednesday (bi-weekly) as announced by the CBN. The CBN announces issuances in their websites and in the pages of national dailies. You can also ask your bank account officer to notify you ahead of an issuance.

How Can I Buy Treasury Bills?

To buy Treasury Bills you will have to approach your bank requesting for a form. You fill the form with your personal information also indicating the amount you want to buy as well has your bid rate.

Nairametrics huwaii

With the advent of banks’ treasury bills mobile application, you are only required to fill a signup form once.

BONUS: Follow link to use Nairametrics’ treasury bills calculator

Standard chartered

treasury bills calculator

What is the bid rate?

The bid rate otherwise called your STOP RATE is the likely interest rate that you have indicated to receive for the principal that you investing in the TB’s. For example you can indicate an interest rate of 10% as your expected rate. Your bid rate will most likely be different from that of other intending buyers of TB’s.

Standard chartered

How is the Bid Rate selected?

The CBN selects the bids that fall below the accepted marginal rates. The Marginal Rate is the minimum average rate for bids submitted within a bid window.  For example, if the marginal bid rate for a bid opened Wednesday 27 June is 11% then bids falling below this rate will be accepted and those above rejected.


[Read Also: This is how to bid for the second Treasury Bills Sale of 2019]

What if I don’t have a Bid rate?

If you do not have a Stop Rate or you are not sure of a rate you can select the option of having the bank choose a rate for you. However, this does not guarantee that the bank rate will be chosen or will be the best.

Can I still buy if my Bid is rejected?

You can purchase TB’s from the secondary market Over The Counter (OTC) through a broker. This is also where buyers and sellers of TB’s trade the notes in exchange for cash.

What are the durations (tenor) for the TB’s?

Treasury Bills are usually for 91 days, 182 days and 364 days. As such, you can have the CBN hold your cash for 91 days, 182 days or 364 days, depending on your choice. However, the CBN can decide they want to sell Treasury Bills for all the tenor available or either of them.


BONUS: Follow link to use Nairametrics’ treasury bills calculator

treasury bills calculator

Can I sell before Maturity?

Yes, you can sell Treasury Bills before maturity. As mentioned above, this can be done through the OTC market. The price at which you sell depends on the forces of demand and supply. For example a N100,000 face value TB maybe selling for less or more depending on the yield expectation of the buyers. If your face value is trading at a higher price, it means you can sell your treasury bills at a profit as such your N100,000 can sell for N101,000 or more. If your face value is trading at a lower price, it means you can sell your treasury bills at a loss as such your N100,000 can sell for N99,000 or less.

When is the interest paid?

The interest element of a treasury bill is paid to you upfront and credited to your bank account. For example, if you purchase a N100,000 TB with an interest rate of 10% the CBN debits your account with N90,000 as such your N10,000 interest is paid upfront. Upon maturity, you are paid the face value N100,000. The upfront payment of your interest makes your true yield actually higher.

What is a True Yield?

True Yield is your actual Return on Investment. (ROI). Using the example above, the initial yield for the N100,000 is 10%. However, because they pay you interest upfront your true yield is actually the N10,000 in interest divided by the N90,000 actually deducted from your account. That is N10,000/N90,000 or 11.11%. This is, thus, higher than the 10% coupon. The True Yield is completely earned when you hold to maturity.

Can I roll over my investment?

The CBN does not rollover your investment automatically. However, you can give your bank a mandate to rollover the principal on your treasury bill upon maturity. You can also get the benefit of compounding interest by asking your bank to reinvest the interest portion of your TB once it is paid.

Are Treasury Bills Safe?

Treasury Bills are one of the safest forms of investment and are backed by the full faith and credit of the Federal Government of Nigeria.

BONUS: Follow link to use Nairametrics’ treasury bills calculator

treasury bills calculator

Apart from the Interest Rates, what are the benefits?

  • A good source of steady stream of income.
  • Treasury Bills are a good investment outlet for your free and disposable cash.
  • Treasury Bills are good investments for people who wish to save.
  • Treasury Bills are also tax free.
  • Treasury Bills are very liquid and can be converted to cash quickly.
  • They can be used as a collateral.

Are Treasury Bills Taxable?

Interest derivable from Treasury Bills are not taxable.

 BONUS: Follow link to short video on Treasury Bills



    • They don’t unilaterally reduce it. They just choose the average bids submitted by all banks. So if your bank bidder higher than the average, they lose out. Cheers

  1. Pls I heard the interest is calculated per annum irrespective of the tenure you buy for eg, i buy 100,000 for 91days at an interest of 10percent, what will i get after the 91days?

    • Yes you can. Just approach your bank and tell them you want to sell. But be ready to get a lower amount as they will deduct part of the interest already paid to you upfront. Regards

  2. I only want to thank you for this wonderful site. I have been looking for explanation on treasure bills and govt bonds. I now have insight on what they represent. Thank you again. Keep it up.

  3. Hello ugi,interesting piece..my question on TBs is does the duration affect the rate of interest and expected yield on it?the interest rate on a 91day period same as,364dys?

  4. Thanks for all the explanation. My question is if my interest bid in bonds fail to be accepted, can I still have my cash back .

  5. i want to have clear understanding on returns in investing in treasury bills, particularly how the rate is applied for 91days, 182 days and the rest.Also which is better in terms of return(fix deposit or treasury bill).


  6. I bought the 364 days treasury bills as at March when the interest rate was less than 10%. Now I do not want to hold the bills till maturity because the rate is now higher. What steps do I need to take to get my money back in order to re-invest at higher interest rate?

    • I am in the same problem. I am ready to let go of the profit if they won’t touch my capital invested. I bought for 12% rate and wouldn’t mind selling for same rate if they wont touch my capital invested. Pls advice.

        • Please there is NO SUCH THING as UPFRONT INTEREST, stop misleading people. If you are investing 900k to get 1m you cannot say you have earned 100k interest please. You earn the interest over the tenor of the investment, PLEASE PLEASE AND PLEASE AGAIN NO INTEREST UPFRONT.

          • Of course, that is what nairametrics meant. It was a simple explanation that was well broken down. You are over-analyzing it

    • This is quite simple. Approach your bank and tell them you want to sell. They will pay you back your capital and deduct the portion of your interest earlier paid to you that is yet to mature. So for example, you invest N1million and 10% for one year. Assuming you went for a 1 year maturity, the CBN will deduct N900k from your bank and pay you N100k upfront as interest. After one year, they credit your bank account with N1m meaning you get a total of N1.1m and gained N100k. Now assuming you decide to hold for only 6 months, the bank will pay you back N950k instead of N1m. So you get in total N100k (collected earlier) plus N950 paid in six months. In total that is one million fifty thousand naira only. Your gain is N50k. Hope this explains it.

      • Hmm, are you sure there are no further deductions by the bank. Things like commission on transaction etc. Because they would usually make some deductions even on the interest paid by CBN.

      • For the 6 month, I beg to differ,

        For the N1m investment @ 10% for 6 months, customer will be debited N1m, and paid an upfront interest of N50k (technically he parted with N950k).
        Upon maturity, he is paid N1m.
        In total, a gain of 50k.

        Note: the bank still pays N1m upon maturity, just like in the case of 1 year investment.

  7. This is such a wonderful and life changing tutorial on treasury bills and bonds. Is this all it takes to start investing in treasury bills or there are still more to do?

  8. I have 2 questions. Is it possible to hold the upfront interest to maturity date and what is the implication of doing this on the interest rate.
    Could you please give a sample letter with reinvesting upfront interest to bank to purchase treasury bill assuming you are out of the country.

    Thanks for all you do.

      • In my own understanding, the best way to reinvest your upfront interest is to include it in your initial investment. e.g. if your capital is 1m at 10%, which is 100k for a year, you can then buy TB of 1.1m instead of the 1m. Now, if you are buy TB of 1.1m at the above percent, only 990k will be deducted from your account. I HOPE THIS IS CLEAR

  9. Pls my question is,if I invest 1. m for instance for a period of one year, the 100k interest is it for the monthly bases or its the interest for the whole year?thanks

    • so 100k for 91 days at 10%, what he did is 10% will be 0.1 multiply by 100k = 10,000 thats for one year because its 91 days, as we know 91 days is just 3 month and how many 3 month are there in 1 year = 4 you divide 4 by that 10,000 giving you 2,500 for every 3month in 1 year.

      hope i am clear

  10. Thanks very much.

    Please i need a long time investment like 2 years with better interest please which investment should i go into that has a better attractive interest ?

  11. Thanks so much but I got a little confused when you said the return for 100k for 91 days is 2500k. Kindly explain further.

  12. Good day, pls I invested 1m, for 91 days at 10%, i was expecting a deduction o 900k from my account, instead i was debited about 972k. Can yoj please help me understand this. Or do i need to go back to the bank? Thank you.

  13. Many thanks for the site admin. I’m thinking of initial investment of about N500,000 and monthly addition of about N50,000 in T.B. Can this work out?

  14. Dear Admin, if I invest N1m in TB, can I tell my bank to roll the capital and gain over continuously for many years up to about 5 years?

  15. All Nigerian investment has a twist! From posts above, If one invests 1m for 91 days @10% and make 25k and another 10m to make 250k after all charges, then the TB business is a waste! The actual ROI is not 100k nor 1,000,000 but 25k and 250k respectively after all charge deductions (a paultey 25%) while a whooping 75% is lost to bank charges!

    • Well, you got your calculation all wrong. I bought treasury bills of 5 million naira in 2017 and i just received my capital in 2018 after 343 days. The interest of 822,260 was paid upfront and after i got my 5m in 2018, 0.09% which was 4228 was deducted. That’s all. Treasury bills is the best investment i”d advise anyone to go for. The percentage was 17.5 from diamond bank.
      Contact me if you need further help charlesnwanko@gmail.com

  16. Pls can u explain futher on the bidrate works. For example if I select a bit rate of 10% and the % selected was 17.5% will I get interest based on my selection or on what the market is (17.5%)

    When u invest for a tenor say 91days do u still have to monitor ur tb withing that period or wait till the end of the tenor.

  17. Sir, am still not clear with this. Lets say i want to invest 100k for 91 days, how will it be processed, what will be my interest after 91days. What will be the charges associatedand how can i access the funds.

  18. Thank you very much for this write-up. I understand all your explanations clearly. However my question is “how can someone lose money or investment with TB?” , The risk , Dos and Don’ts

  19. I understand the explanations clearly. However, what are the possible ways someone lose money(or all the investment) with TB?

  20. Thank you for the article.please help a sister,I booked treasury bill of 370,000 with one of the new generation banks on monday 9th July 2018 and I recieve a debit alert of 351,000 for the treasury bill on thursday 19th July 2018 instead of the previous day wednesday which is the normal day for biding treasury bill,mean while i have 371,690.40.the difference is 20,600.95.then I was confused because expecting something like 37,000 or more.Then I called their customer care no and they told me that the 20,600.95 is my interest .but as at wednesday 18th July 2018 treasurybill interest rate was between 10.5 & 11.5%.My first question is at what interest rate did they book me and secondly does bank take their on share from customers interest.please help me I am confuse.note I booked for 6 months.Sorry for the long comment.

    • Ma, the 10.5 & 11.5 you quoted is for full year. You booked 6 months that implies your interest would be half of 10.5 or 11.5 depending on the rate your bank uses. Treasury bill is a discounted instrument hence interest is paid upfront so that you get the face value at maturity

  21. please i booked 370,000 on 13th July for 67days. i cant really remember the percentage now but up to 365,000 was deducted from my account. i want to know where i can be getting information on Treasury bills to know when the interest rate increase or decrease

  22. I invest this August 15 2018 for treasury bills with 600000 I expecting them to move 540000 they moved 587400 pls why I want to know.

  23. Guys the 10% or whichever % they offer is actually calculated for a 1 year(12months or 364days) period. This means whatever % you are expecting is spread through the aforementioned period. For example your 10% interest is spread through the 364days, thus giving you about 0.027% per day…Hence, 91days gives 91×0.027 = 2.457%; 182days = 4.99% and so on and so forth…..Hope this bridges the calculation gap we seem to be having..

    • Hello Frank.. pls help out. i just contacted Zenith and Sterling customer care respectively asking them for the rates of treasury bills

      Response from sterling is that the returns are 10.5% per 91 days and 11.6% for 182 days

      Response from Zenith is tha the returns are 11% per 91days and 12 + % for 182 days

      Naive me thinks this implies if i today invest 100k for 91 days to TB through Sterling i should be able to make a profit of N10500 after 91days

      is this calculation correct?

  24. Thanks bro, I went though your patient to reply all questions. Pls which one will you advice a starter like myself. I actually have mutual fund in mind before I ran into your writeup. Mutual Fund or Treasury Bill

  25. Please when you say interest is paid ‘upfront’ does that mean u can cash out on the interest or you have to wait till maturity before you access the interest along with your principal?

  26. Please, can you clarify what you mean by “Minimum Average Bid Rate”, as I’m struggling with the word “Minimum”? Are there several averages computed and how?

  27. Can I buy TB from any bank outside my bank,if their interest is higher than that of my bank. Also wants the disadvantage of such transaction if any.

  28. Good day sir, I went to first bank several times in the last five years asking for FGN Bonds or TBs to buy, but the keep telling me the haven’t received signal for it, or a times there is nothing like that . please help me I am a student. Again, is it preferable through Bank or through a stock broker?

    • Go to sterling bank and use the i-invest app spoken about by the author of this article. I-invest app can be found in your android playstore. Then go to sterling bank for further explanations before you actually invest. They partner to own the app

  29. If I invest 100k by march 2019 and I want to invest it for 2 years, is adding 100k per month to the initial 100k possible?? And how much will the interest be at the end of 2 years.

  30. Nice write up, Thanks. From all I have read above its almost very close to fixed deposits. Which will you advise?

  31. I had some awkward experience with First Bank. I invested #20million in treasury bills at a rate the bank officer advised me for 182 days. My account was debited for 20m on a Monday and after about two weeks my principal amount was returned to my account. When I inquired about it I was told that my bid did not succeed. Please explain what ciuld have happened.

    • 1. Kindly give me your phone number
      2. I applied for TBill through GTBank, I got an acknowledgment mail that it will be treated. Unfortunately, as at now Wednesday 13th November, my money is still in my account
      3.what can I do not lose out
      Kindly advise
      Thank you

  32. Thanks for the article.
    I bought treasury bills through two different fund managers. One of the investment letter that i received after purchase has this statement – ”please note that the treasury bills are held on your behalf in our books”. The other has – ‘the treasury bills are held with our custodian – Stanbic Nominees Ltd in line with SEC requirements”. If any of these fund managers go under, where can i tender these documents to claim my money?

  33. I invested one million naira in the primary market of treasury Bill Oct 30th 2019 for 1year, FGN/CBN discount rate was 12.92% for 365days but my investment bank only gave me N11.3% (N113,200),with the claim that I demanded for upfront payment and that I can only get N129,200 if I do not collect upfront, please is this correct ?.

  34. Please help to clarify what the current ban on TB means. If one is unable to buy TB through banks, what are the other options to invest?


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